Bozeman Montana Real Estate | Nick Zimmer Realty Executives

On Wednesday, February 1, President Obama presented a series of housing proposals. The primary proposal aimed at making mortgage payments more affordable for existing homeowners-particularly those struggling with underwater mortgages. It’s still a long way from approval, but if the package passes, how will it affect you?

If you’re underwater, have good credit, and are currently paying an interest rate over the current rate, you’re in good shape. The program will extend refinancing at today’s rates to almost all homeowners, including those with negative equity.

As with any law, there are guidelines and standards. These refinance packages are available only to homeowners with a FICO score of at least 580, apply only to primary-residence, single-family homes, and the size of your loan must be within FHA conforming loan limits. Still, that covers the majority of the country’s existing home mortgages, and the government expects an average savings of $3000 per year, per refi.

The proposal also includes a plan to convert foreclosed properties into rentals to reduce downward pressure on housing prices.

Please take a minute to visit my website where you will find all listings in our area as well as an archive of previous Friday updates (under Market Updates)

WWW.NICKZIMMER.COM

 Click Here to View Listings

Your first home purchase is exciting, but it can also be stressful. Here are some tips to limit the trauma and help you find the home of your dreams the first time around.

The most important step in selecting a home is knowing how much you can spend. If you already use an electronic budgeting system, you’re ahead of the game. If not, track your expenses for the past several months to a year. Try to quantify the “gray areas” of cash withdrawals that disappear on small purchases. Now add up your current rent and other related expenses. If you’ve been saving money toward your down payment, note that, as well. Finally, ask yourself where you can tighten your belt with your existing discretionary purchases. This is the maximum amount you could pay per month. Now ask yourself if this is reasonable, given your current savings and possible expenses. Only you know the answer to that. When you’ve arrived at a comfortable number, write it down, and save your calculations. You’ll take this to the bank when you apply for loan preapproval. For now, you have an estimated payment you can use while shopping online. 

Set your Criteria

A home is the biggest purchase you’ll probably ever make. Stay focused and don’t let emotion guide you. If you have one child and no plans for more, four bedrooms are probably a waste. Write down a list of must-haves, nice-to-haves, and can’t haves before you start visiting homes. You’ll save time, help your agent work more productively, and keep yourself from getting carried away-into the wrong house.

Important criteria include:

• Age of house
• Number of bedrooms and bathrooms
• Size of lot / yard
• School district requirements
• Type of street (Are busy streets OK, or do you want a cul de sac? Do you need to be near a bus or light rail line?)
• Type of home (Single-story? Mutli-level? Are there any dominant architectural styles in your area that you refuse to buy?)
• Central heating and cooling
• Expensive additions, such as in-ground pools

Make a list of Homes

After you’ve made this list, search online and find several representative homes. If you have time and you’re fairly local, drive by a few of them to get a feel for the neighborhoods. Write down your impressions. This will help you understand home much of a home’s description is fact versus fluff, and give your real estate agent a good idea of your likes and dislikes.

Find a Realtor®

Most home buyers select a licensed Realtor® to represent them, and they are almost always happy they did. Realtors® are real estate agents who subscribe to a strict code of ethics and are acknowledged experts in the field. A Realtor® knows your local market, and can help you through every step of the home buying process, from finding your dream home to negotiating the best possible terms, explaining everything along the way.

Bring a Camera

Your Realtor® will take you on a number of open houses, and your opinions can be lost in the blur. To keep things straight, bring a digital camera on your trips. Take a picture of the street number of each property, then photograph each room during your walk-through. Photograph a house even if you decide it’s wrong for you-there may be furnishings, construction tips, or other features you notice later that could come in handy when you find the right home.

 Click Here to View Listings

Please take a minute to visit my website where you will find all listings in our area as well as an archive of previous Friday updates (under Market Updates)

WWW.NICKZIMMER.COM

The Obama Administration’s latest Housing Scorecard showed some housing market improvements. And a Wall Street Journal commentary espies opportunity in the housing market despite sour conditions.

Freddie Mac announced it would continue to suspend or reduce mortgage payments for unemployed home owners. See what all of this means for you in our latest roundup of top headlines.

Federal Housing Scorecard Shows Improving Market. The Obama Administration’s most recent Housing Scorecard - a comprehensive report on the nation’s housing market – shows subtle improvements in the market over the past year, but a mixed outlook going forward.

Come December, when we look back at how the housing market fared in 2012, this won’t be a year remembered for how bad it was, but for how bad it wasn’t. Over the course of the six-year housing correction, immense amounts of risk have been bled out of the market to a point where, in general, opportunities for good investments outweigh the risk of further losses. Here are 12 themes for housing in 2012, and while not all represent rosy optimism, they support my continued view that housing bears are seven years late to the party. And while bulls may be early, the good ones always are.

CBS News: Freddie Mac Offers a Break to Unemployed Home Owners.

Unemployed home owners will be allowed to suspend or reduce mortgage payments for as long as a year under a new policy announced by mortgage finance firm Freddie Mac on Friday. The new rules take effect on Feb. 1.

Washington Post: As Consumer Credit Scores Plunged in 2008-2009, Lenders Raised Their Standards.  

How big a whack did your credit score take during the grim years of economic distress following the housing bust? Was it 20 points, 50 points, 100 points – or maybe no drop at all? These are key questions affecting millions of potential home buyers who hope to qualify for mortgages as well as current owners looking to refinance. New research from a major credit-risk evaluation company suggests that the drop in huge numbers of Americans’ scores was dramatic.

Perilous to Tinker with Home Ownership Programs, Voter Survey Finds

Washington may be having trouble finding bipartisan consensus, but a new survey has pinpointed one area where likely voters – Democrats, Republicans, Tea Partiers, Occupiers – agree: home ownership and many of the government programs that support it are important enough to affect elections.

 Click Here to View Listings

Please take a minute to visit my website where you will find all listings in our area as well as an archive of previous Friday updates (under Market Updates)

WWW.NICKZIMMER.COM

Over the past few years I have done a small handful of purchase transactions with buyers who are across the country and can’t visit the home. So far they have all been smooth and ended up being a very positive experience for all parties involved.

Here are a few tips if you ever need to do this type of purchase. 

With intense variation in properties values across the country and an explosion in entails, the prospect of buying a home far from your current address are looking up. Any home purchase can be stressful, but trying to manage the selection and processing from afar can bring even the most experienced real estate pro to tears. Here are some tips to help you find your home away from home without losing your mind or your money.

1. Perform background research

What works for most may not work for you. Austin is fantastic-if you’re OK with muggy summers. Portland is amazing-unless you hate the rain. If you’re looking for a potential residence, a little research will help you narrow down your lost of dream cities. Start with some research on climate, crime, and demographics. Quiz sites like findyourspot.com are unscientific but fun, and can help you locate areas you wouldn’t have considered. Once you’ve made a short list, investigate average home prices to ensure that you’re not pricing yourself out of the market before you begin. 

Now that you have a target, search for local communities online. Free message boards like Craigslist and review sites like Yelp can be great places to meet locals and get a town’s feel. Explain your situation, concerns, and “must haves” to the community, but take everything with a grain of salt. Anonymous users will often exaggerate, may have a personal axe to grind, or may be promoting their own product or agenda. Still, it’s a good place to start.

You should also look for public forums dedicated to planned communities, rental developments, or Homeowners Associations in your town. Again, these may be somewhat slanted toward complaints, but the people behind the posts will be somewhat less anonymous than other sites, and they could provide necessary input on step 3.

3. Get a referral

If your online research leads you to a good REALTOR©, it was worth the effort. A knowledgable, local REALTOR© will be able to translate your requirements and limits into a realistic list of possibilities, while explaining options you hadn’t considered. A REALTOR© will also let you know if your demands are unreasonable, and can suggest ways in which you might be able to compromise.

A REALTOR© is a professional, and should be treated as such, so come to the table with as much information as you can. Financial records, pre-approvals, addresses of homes you find interesting, and a detailed list of must-haves and deal-breakers will show the REALTOR© you’re serious about this transaction and help her get to work quickly and effectively.

4. Visit the area

It’s not recommended to buy a property sight-unseen (sometimes it’s not in your cards) but eventually you will need to visit the area. With your preliminary research complete and a broker on the case, you can probably get in and out in just a day or two if necessary. Remember to save all of your receipts, as some of your trip may be considered a business expense. Check with your accountant to be sure.

5. Find a friend

If you made any online friends during your research, your trip would be a good time to reach out in person. In addition to building a social network, making contact with a few friends can give you eyes on the ground. Most purchases will require several trips out, and having a friendly representative who can visit open houses, take pictures, and report back can be a lifesaver.

 Click Here to View Listings

Please take a minute to visit my website where you will find all listings in our area as well as an archive of previous Friday updates (under Market Updates)

WWW.NICKZIMMER.COM

There are plenty of reasons to purchase rental properties. They can provide steady, passive income when the housing market is slow, allowing you to sell only when conditions are right. They can allow first-time buyers to enter the market when they’re priced out at home, and are an excellent way to build equity in a retirement or vacation home.

1. Do not expect a quick profit

If you have visions of flipping your rental property in just a few years, stop now. Historically, rental properties have been an excellent source of long-term income, but their resale prices are based more on income streams than spikes in home prices. This is particularly true of multi-unit dwellings, and is even more pronounced in a depressed market. There’s little debate that you will be able to sell your rental property at a tidy profit some day, but unless your primary focus is on building equity and earning passive income over time, you’re in the wrong part of the business.
 

Generally speaking, you want to buy a rental property in the best neighborhood you can afford. An ideal neighborhood would have low crime, a population influx, and proximity to transportation, employment, and amenities.  

The character of your neighborhood is important as well. A 3-bedroom duplex will have faster turnover and receive more wear-and-tear in a college town than a sleepy family community. A high-end rental home in the suburbs might be a short-term fix while a couple searches for a purchase, but the same home in an urban area could be a long-term rental for a busy businessman.

3. Play the waiting game

If you price your property too high, you may lose money on an extended vacancy. If you price too low, you risk losing money over time. After you have a few years of ownership in your neighborhood under your belt, weighing the trade-offs will become easy, but when you’re starting out, you’ll want to seek the advice of an experienced professional. Start by asking your REALTOR©, who may be able to refer you to other rental property owners.

4. Know your tenants

Bad tenants will damage your property, run up maintenance bills, call you (or your management company) at odd hours, and leave you holding the bag for months of rent when they abandon your property. Good tenants provide a predictable revenue stream and respect your investment. Do not cut corners with due diligence when choosing a renter. Credit checks are important, but checking references is critical.

Once you find your perfect tenants, be open to working with them. Be flexible with improvements or changes they’d like to make to the property. If they’re going through hard times, a minor rent adjustment could be well worth the long-term payoff. In the end, you need the tenants as much as they need you.

5. Be prepared

Rental properties require a fairly substantial cash reserve, as well as other preparations. You’ll want to be able to cover several months of mortgage payments to address vacancies and payment processing time. Rental properties require a larger downpayment (often 25-30 percent) than evidential properties, so budget accordingly.

You should also line up contractors and maintenance staff as soon as you purchase a property. Again, your REALTOR© or network of other landlords can point you in the right directions. Check references, pre-negotiate rates, and ask for backup referrals for times when your primary contractors are not available. Be sure to ask your tenants for feedback on the contractors’ work and conduct, as well.  

 Click Here to View Listings

Please take a minute to visit my website where you will find all listings in our area as well as an archive of previous Friday updates (under Market Updates)

WWW.NICKZIMMER.COM

Are you thinking about selling your home, but waiting for prices to rebound? You might be making a mistake. There are plenty of reasons you might want to hold onto your home for a while longer, but for most of us, market conditions aren’t usually one of them.

The logic usually sounds something like this. “If I sell my home at a lower price, I’ll have less to invest in my next home, and I won’t be able to afford the property I really want.” That makes sense if your home’s property value is being depressed more than the homes you’re considering buying, but since most of us tend to move locally, that usually just isn’t the case. If prices drop by a similar percentage, you’ll spend less money if you move up while prices are low.

Here’s an example. Let’s say you have $100,000 left on your mortgage, and your home used to be worth $300,000, but is now worth $200,000. You want to buy a home that used to cost $600,000, but has also dropped 33 percent, to $400,000. If you sell your home now, you’ll net $100,000, which means you’ll have a $300,000 mortgage on the new property. If you wait until both properties climb to their original level, you’ll net $200,000, but you’ll need a $400,000 loan to close the gap.

There are plenty of exceptions to this rule. Sometimes, lower-priced houses are hit harder, with a glut of foreclosures and new construction on the market, while luxury properties remain stronger. In those cases, waiting makes a lot of sense. You might also be moving to an area with a very different market, or you might want to move for more than financial reasons. If your dream house is on the market and you absolutely need to have it, price may not be your most important consideration.

If you have questions, always speak to a knowledgable REALTOR® before making any decisions. A good REALTOR® won’t try to force you into selling before you’re ready, and will be able to provide a wealth of information about your market that will help you make your most informed decision.

 Click Here to View Listings

Please take a minute to visit my website where you will find all listings in our area as well as an archive of previous Friday updates (under Market Updates)

WWW.NICKZIMMER.COM

The last few years have been rough on everyone. Bankruptcies, foreclosures, short sales, and unemployment have ravaged the savings and credit ratings of hard-working honest citizens, and their effects can linger. As our economy gets back to work, you may find yourself in an increasingly-common position: bad credit but good income.

Is your credit score only hampered by past behavior, or are there current items weighing you down? If you have unpaid judgements or high revolving debt balances, you should almost always pay them down first. Doing so will increase your buying power and decrease your risk in the bank’s eyes, but it will also save you money right away. If you can hold off until you’ve paid off your most dangerous debt, do it.   

Don’t assume you’re out of the running just because you were turned down for other kinds of loans in the past. A credit score as low as 580 can qualify for an FHA home loan if the borrower meets other criteria. If you’re below that cutoff, your options are limited, but in many cases, while a score in the 700s could take years, a few phone calls can bring you back toward 600 and get you where you need to be. If you’re not sure where you stand, your best bet is to visit a loan officer and ask their advice.

If you’re looking to buy an investment property, don’t jump in too quickly. Rental properties are a hot commodity these days, but you might find yourself in over your head in pretty short order. Commercial loans are riskier than residential loans, since the owner has less to lose, so you can expect to pay a very sizable down payment to receive any kind of reasonable interest rate. The numbers might still work out for you if you find the perfect deal or can do some restorations on your own, but you’ll be locking up a lot of capital in the short term. If you plan to live in your new home, banks may be willing to cut you a bit of a deal, particularly in slow markets.

Is the house for sale now the only home that will do? Are you being forced to move from your current home? Every market is different, and some are reheating faster than others, but unless you have a specific reason to act now, a few months of saving will usually yield better results in the long term. You’ll be able to take out a smaller loan for your target house, and you might be able to step up the house you want. Scrimping now will almost always pay off in the long run.

 Click Here to View Listings

Please take a minute to visit my website where you will find all listings in our area as well as an archive of previous Friday updates (under Market Updates)

WWW.NICKZIMMER.COM

 Click Here to View Listings

Please take a minute to visit my website where you will find all listings in our area as well as an archive of previous Friday updates (under Market Updates)

WWW.NICKZIMMER.COM

 Click Here to View Listings

 Click Here to View Listings